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5. UNDER RATES PRESCRIBED BY COMMISSION, WATER COMPANY WILL CONTINUE TO SUEEER A DEFICIENCY IN REVENUES OF NOT LESS THAN $86,858.00 PER YEAR MEASURED BY THE RESULTS OF OPERATION IN THE TEST YEAR 1951. The Commission prescribed a scale of rates which it estimated would produce additional revenpe of $25,112.00 per year. We agree that this estimate is substantially accurate. During the calendar year 1951 the Water Company will not re­ceive additional revenue of $25,112.00 because the new rates did not go into effect until September 1, 1951. Therefore, although we use the operating revenues and expenses for the year 1951 for the purpose of testing the operations of the Water Company, it is obvious that the Water Company in that year will receive less revenue than is assumed by the calcu- 4 lations hereinafter referred to. In fact the Water Company will only receive approximately $8,370.00 in additional reve­nue in the year 1951 under the prescribed rates instead of $25,112.00. If in 1952 operating expenses continue to in­crease faster than revenues as they have in the previous three years, the not affect of the prescribed increase may be entirely wiped out. Basing our observations on the test year 1951 and assuming that the Water Company would receive in that year $25,112.00 in additional revenue under the prescribed rates, » the fact remains that the Water Company in that year will not earn a fair return but will in fact suffer a deficiency in revenues of $86,858.00 when the rates of the Water Company -69-